Why the United States is embedding Ukraine in its strategic orbit with "mineral deals"
This week promises to be full of both geopolitical events and domestic political struggles.
On the geopolitical scene, we seem to be waiting for a denouement in the implementation of Trump's "peace plan." Or rather, the revealing of the cards in this round of poker. At the moment, I cannot pass by the domestic political festival of criticism and slogans about the "mineral agreements," as the agreements on economic cooperation and the creation of the Investment Fund for the Restoration of Ukraine are called.
As of now, this is a package of multi-level agreements that define the legal framework for economic cooperation between the US and Ukraine, and also allow to eliminate one of the main points of tension between the presidents.
The very fact of signing the agreement was presented by US Treasury Secretary Scott Bessent as a "royal flush" from Trump to President Zelenskyy in peace talks with Russia. Despite their usual audacity, the Russians behind the curb are already recognizing that the agreement significantly worsens their position in contacts with the US.
However, this is not the victory that is being discussed in Ukraine. Just like in the joke about the rescued boy: "You saved the boy? Where is the cap?"
It turns out that we have a lot of experts in negotiation tactics and Delaware lawyers. More than half of the Fortune 500 companies are registered in Delaware. The state's progressive business-friendly legislation has attracted more than a million corporations with investors from the UK, Germany and Switzerland.
At the same time, almost no one pays attention to the significant change in the approach to the format of agreements or their focus. If we look at the transformation of approaches to the format of agreements over the course of two months, it becomes clear that we have avoided a number of conditions unacceptable to Ukraine from previous projects, managed to balance the interests of the parties and created a basis for the development of private investment in the reconstruction of the Ukrainian economy.
American businesses are not given special privileges over other investors, and the parties' contributions to the Fund, which is created to invest only in Ukraine, include only new funds. The United States may count as contributions the cost of new weapons, not compensation for previous US assistance. Ukraine's contributions to the Fund will come from new licenses for the extraction of rare earth materials, oil and gas and will amount to 50% of the rent paid to the budget.
The Fund invests only in Ukraine (natural resources and related infrastructure) and therefore receives the right to make the first offer to invest in projects in Ukraine (Right of First Offer). And the partners can start sharing the profits from the Fund's activities in 10 years.
The main criticism, in addition to the location of the "cap," concerns "security guarantees." These could not be included in the agreement, because the subject matter of the agreement is completely different. And what guarantees in the modern world can ensure security? Can we really rely on commitments recorded on paper?
Neither Poland nor the Baltic states believe in "paper" guarantees anymore. Future security is a matter of resources for the purchase and production of weapons. DFC (a US financial institution that is a co-founder of the Fund) writes on its website about "a historic document and a message to Russia that America has a skin in the game".
In fact, this is a signal to investors that the United States is not just supporting Ukraine, but is integrating it into its own strategic orbit. Because in the field of natural resource extraction, projects have a very long horizon – an average of 18 years from the discovery of a deposit to the start of a fully operational asset. With the cost of developing one mine ranging from half a billion to a billion dollars.
We reasonably dislike Trump's basic idea of rewarding the US for its past military and financial support of Ukraine, but this idea has now undergone significant changes. And the agreements create a concrete framework for further economic cooperation between the US and Ukraine, which should ensure that the US maintains political goodwill in the future.
However, the success of the implementation of these agreements, as well as the further development of the treaty base, depends on our capacity. No one is interested in our success but us, and therefore we must remember the words of Theodore Roosevelt: "Do what you can with what you have, where you are.".
So this week, the main domestic political intrigue is whether the Verkhovna Rada, despite political quarrels and total distrust of the government, will be able to ratify the "mineral deal" instead of pouring water on the mill of the Russians, who are very eager to "shoot down" this deal .